Finance Minister Muhammad Aurangzeb has disclosed in an interview to the leading Russian news agency RIA, formerly the Novosti Press Agency, that the two countries’ energy ministries are in talks over an oil deal. Such a deal, it might be recalled, had caused a great deal of grief for India, after the USA imposed extra tariffs on it because it was importing Russian oil at a discount. India was supposed to have been importing oil at a heavy discount from Russia, and then selling it on at the full price on the global market, pocketing the difference.
Russian oil had become a political football when the PTI after dismissal hinted that then Prime Minister Imran Khan had been in Russia on the day it had invaded Ukraine, and that he had struck, a deal for Russian oil discounted below the global price. The PTI had accused the Shehbaz government which replaced is, of giving up a golden opportunity to benefit the country. The coalition caved under the pressure, and obtained a cargo of Russian crude. However, it transpired that it could not be processed by Pakistani refineries. This was swiftly followed by the imposition of sanctions this year by US President Donald Trump. Pakistan was given lower tariffs than India, which penalized even further because of its oil purchases. The USA is particularly irritated by such sales of Russian oil because they bypass US sanctions, and provide Russia the hard currency it needs to prosecute the war in Ukraine. Senator Aurangzeb’s remarks did not explain whether the refining issue had been overcome or not. The use of oil as a diplomatic weapon by Pakistan was demonstrated when it purchased crude from the USA, with one cargo having already arrived, which it had done to reduce its trade surplus with the USA.
The recent Russia-India rapprochement, which followed the US tariff rebuff to India, is probably the reason for Pakistan trying to create some goodwill with Russia. This is despite the tilt towards the USA which followed recent interactions between the two governments. Pakistan may be relying on its expected role as a UN peacekeeper in the US Gaza peace plan, but it still does not seem wise to vacillate quite so wildly in its policies. It should remember that the USA can see though its machinations, and if the Shehbaz government wishes to take it on, it should be ready to do so fully, for the Trump Administration suits only itself.
